Tensions
between
providers
and
payers
are
increasingly
spilling
into
the
courtroom,
with
health
systems
and
provider
groups
turning
to
the
legal
system
for
relief
from
what
they
say
are
unfair
payment
rules
and
policy
overreach.
Here
are
three
recent
examples
of
healthcare
providers
suing
insurers
over
alleged
underpayment.
California
Hospital
Association
sues
Anthem
The
California
Hospital
Association,
which
represents
nearly
400
hospitals
across
the
state,
filed
a
lawsuit
on
Monday
against
Anthem,
challenging
the
payer’s
“network
penalty
policy.”
Under
the
policy,
Anthem
decreases
its
payments
to
hospitals
by
10%
when
patients
are
treated
by
out-of-network
physicians,
even
if
the
hospital
itself
is
in-network,
which
effectively
penalizes
hospitals
for
not
agreeing
to
the
payer’s
terms,
the
complaint
said.
The
association
contends
that
these
payment
reductions
go
beyond
normal
out-of-network
reimbursement
rules
and
hurt
hospitals’
ability
to
cover
the
cost
of
care.
More
broadly,
the
association
argues
the
policy
puts
pressure
on
hospitals
to
accept
lower
in-network
rates
during
contract
negotiations.
“We
are
confident
the
courts
will
recognize
Anthem’s
move
as
a
flagrant
attempt
to
increase
their
profits
at
a
time
when
millions
of
Californians
are
projected
to
lose
their
health
care
coverage,”
Daron
Tooch,
the
association’s
legal
counsel.
“The
policy
is
unethical
and
unlawful,
and
we
look
forward
to
a
decision
from
the
court
that
protects
not
just
hospitals,
but
also
Anthem
enrollees
who
trust
that
their
insurance
company
will
respect
their
right
to
choose
their
own
doctor.”
The
lawsuit
seeks
to
block
the
policy
and
recover
payments
that
hospitals
say
were
improperly
cut,
as
well
as
asks
the
court
for
a
declaration
that
Anthem’s
approach
violates
state
reimbursement
requirements.
In
a
statement
sent
to
MedCity
News
on
Tuesday,
Anthem
stood
by
its
policy.
“Unfortunately,
some
out-of-network
providers
undermine
the
protections
and
goals
of
the
No
Surprises
Act
and
charge
working
families
and
their
employers
tens
of
thousands
of
dollars
more
than
what
Medicare
and
in-network
providers
are
paid
for
the
same
in-hospital
medical
care.
That
out-of-network
billing
is
not
fair,
and
our
policy
creates
an
incentive
for
hospitals
to
stop
it,”
the
payer
wrote
in
its
statement.
Broward
Health
sues
Florida
Blue
Fort
Lauderdale-based
Broward
Health
sued
Florida
Blue,
the
state’s
most
dominant
payer.
Broward
alleges
that
Florida
Blue
has
systemically
underpaid
for
emergency
services
since
the
health
system
went
out
of
network
on
July
1
after
contract
negotiations
failed.
The
complaint,
filed
April
7,
claims
Florida
Blue
reimbursed
emergency
department
claims
at
rates
below
both
billed
charges
and
what
Broward
considers
“usual
and
customary,”
rather
than
the
fair,
market-based
reimbursement
levels
required
under
state
and
federal
law.
“Broward
Health
has
not
agreed
to
accept
any
form
of
discounted
rate
from
Blue
Cross
or
to
be
bound
by
Blue
Cross’s
payment
policies
or
rate
schedules
with
respect
to
any
of
the
medical
services
provided
by
Broward
Health
to
Blue
Cross’s
Members.
Notwithstanding
the
absence
of
any
such
agreement,
Blue
Cross
has
unilaterally
applied
an
unlawful
discount
to
its
payments
to
Broward
Health
for
such
services,”
the
lawsuit
reads.
Broward
is
seeking
payment
plus
12%
annual
interest,
and
is
also
asking
the
court
to
set
interim
reimbursement
rates
while
the
dispute
is
ongoing.
A
Florida
Blue
spokesperson
told
MedCity
News
on
Tuesday
that
the
company
had
no
comment
on
the
matter.
Jefferson
Health
sues
Aetna
Philadelphia-based
Jefferson
Health
filed
a
complaint
on
April
6
against
Aetna,
claiming
the
payer
is
unfairly
reducing
payments
for
some
hospital
stays
under
Medicare
Advantage.
The
lawsuit
centers
on
Aetna’s
“level
of
severity
inpatient
payment
policy”
for
Medicare
Advantage
beneficiaries,
which
took
effect
on
January
1.
Under
this
policy,
some
hospital
stays
that
are
technically
approved
as
inpatient
are
paid
at
a
lower
“observation-level”
rate
if
Aetna
decides
the
patient
wasn’t
sick
enough.
This
mainly
applies
to
hospital
stays
lasting
between
one
and
four
midnights,
even
when
a
physician
has
admitted
the
patient
as
an
inpatient.
Jefferson
argues
that
this
policy
“downcodes”
legitimate
inpatient
care,
therefore
reducing
hospital
revenue
and
creating
additional
administrative
burdens
for
providers
to
deal
with
as
they
appeal
the
lower
payments.
The
health
system
also
said
that
Aetna
unilaterally
created
a
new
payment
tier
that
was
never
negotiated
as
a
part
of
their
shared
Medicare
Advantage
contract.
The
complaint
also
claims
that
the
policy
violates
CMS’
two-midnight
rule,
which
requires
Medicare
to
cover
hospital
stays
as
inpatient
when
a
physician
expects
the
patient
to
need
care
for
at
least
two
midnights.
It
asserts
that
Medicare
Advantage
plans
must
follow
the
same
standard.
Jefferson
is
seeking
an
injunction
stopping
Aetna
from
using
the
policy,
as
well
as
compensation
for
legal
fees
and
damages.
Aetna
is
defending
its
policy,
according
to
a
statement
a
company
spokesperson
shared
with
MedCity
News
last
month.
“Aetna’s
policies,
including
the
Level
of
Severity
Inpatient
Payment
Policy,
comply
with
all
applicable
federal
law
and
regulations
and
with
the
terms
of
our
provider
contracts.
Aetna
disagrees
with
the
allegations
in
the
lawsuit
and
will
respond
in
the
appropriate
forum,”
the
statement
read.
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